December 10, 2005

He hit the ground quickly after he arrived in April. At first, he said, some executives told him that it was a big company and that he should get to know it for a year or so before deciding what to focus on. “That lasted about two weeks,” he said.

In meetings of senior executives, the subject of how to cope with the Internet services shift in computing, how to turn it into an opportunity for Microsoft, was a constant theme – and one that deeply interested Mr. Ozzie. “Within a month, Ray was putting his thoughts on software-as-services on paper,” noted Jeff Raikes, president of Microsoft’s business division, which includes the Office products and corporate software.

Mr. Ozzie then spent the next few months meeting with people across the company to see what work was being done in product groups. Simultaneously, he was devising a plan to help Microsoft capitalize on Internet services by blending the new technology – and economic models – with Microsoft’s traditional software business.

And one odd note unrelated to Ozzie:

Google was among the companies that attended a meeting last month at I.B.M.’s headquarters in Armonk, N.Y., of the Open Document Foundation, a group formed to agree on freely available formats for word processing, spreadsheets and other office documents; the idea is to come up with alternatives to Microsoft’s proprietary Office formats. And for the last few months, Google has talked with Wyse Technology, a maker of so-called thin-client computers (without hard drives).

The discussions are focused on a $200 Google-branded machine that would likely be marketed in cooperation with telecommunications companies in markets like China and India, where home PC’s are less common, said John Kish, chief executive of Wyse. “Google is on a path to developing a stack of software in competition with the Microsoft desktop, and one that is much more network-centric, more an Internet service,” Mr. Kish said. “And this fits right into that.”